The deal is a remarkable coup for ITV, who have been looking for a leader since Charles Allen resigned in August.

Grade's defection is devastating news for the BBC. Grade was due to become chairman of the new BBC Trust.

The BBC's biggest rival has been struggling on screen and wracked by problems off-screen. The broadcaster was forced to reject a takeover bid by NTL, while BSkyB swooped 10 days ago to buy 18% of ITV to block that potential merger.

It will also shock the City, where bookmakers had not bothered even to include Grade on their lists of runners and riders for the ITV job.

Grade, was chief executive of Channel 4 and then rejoined the BBC in 2004 after the resignation of chairman Gavyn Davies.

He will be seen as a charismatic and experienced leader for ITV.

A source close to the deal said: "This is a sensational coup for ITV. This guy is the Wayne Rooney of the sector and ITV's got him."

The BBC was caught unawares by the revelation by Jeff Randall in the Daily Telegraph.

The news is believed to have been leaked by the government, which has been battling with the BBC over its licence fee settlement.

No BBC statement was immediately available and ITV declined to comment.

The City should be pleased with the move, given Grade's breadth of knowledge of business and showbusiness.

Grade is certain to earn a seven figure pay packet.

Mr Grade is well known to Zygos, the firm ITV appointed as headhunters to find Charles Allen's replacement.

The group's first major media role came at the end of 2003 when it was appointed to find the current ITV chairman, Sir Peter Burt. But it hit the headlines in early 2004, when BBC chairman Mr Grade contracted the company to lead the search for a new director general following the resignation of Greg Dyke.